StarHill Global – BT

Starhill’s Q4 DPU falls 2.9%

STARHILL Global Real Estate Investment Trust (SGReit) posted a 4.7 per cent decline in income available for distribution to $22.2 million for the fourth quarter ended Dec 31, 2011, from $23.3 million a year back.

Income to be distributed to unitholders also fell 2.9 per cent during the same period to $19.6 million. Correspondingly, Q4 distribution per unit (DPU) dipped 2.9 per cent to 1.01 cents from 1.04 cents a year earlier. This was mainly attributed to rental disruptions from the asset redevelopment works at Wisma Atria and negative rental reversions in Singapore office space, which also led to a 0.6 per cent decline in net property income (NPI) to $36.5 million for the quarter.

For the full year, SGReit posted NPI of $143.6 million, a 10.1 per cent increase from $130.5 million.

Income available for distribution also rose 10.1 per cent year-on-year to $90.8 million from $82.5 million, while annualised DPU for FY2011 rolled in at 4.12 cents, translating to a yield of 7.3 per cent using the Reit’s closing price of 56.5 cents as at Dec 30, 2011, the last trading day of 2011.

Gearing levels remained at a healthy 30.8 per cent as at the end of the financial year, leaving comfortable debt headroom for future acquisitions, the company said. In addition, a $65 million unsecured revolving credit facility maturing in December 2013 was obtained, enhancing the group’s financial position. Management also highlighted that there will be no debt refinancing till 2013.

Demand for the Reit’s office space also remained healthy, with occupancy levels within the Wisma Atria and Ngee Ann City offices rising to 95.8 per cent and 94.9 per cent respectively as at Dec 31. Take-up for retail space at both assets was also strong as leases expiring last year managed to secure positive rental reversions.

The company said the asset redevelopment of Wisma Atria is ‘on track’ and is slated to be completed in the third quarter of this year. So far, more than 75 per cent of the double-storey facade units fronting Orchard Road have received pre-committed leases and the manager will try to ‘minimise disruptions’ with a ‘two-phase handover’ of the finished units over the first half of 2012.

Yesterday, the counter closed unchanged at 60 cents.